When the Georgia Reverse Mortgage Loan Ends!
The loan ends when the homeowner dies, sells the house, or, depending on the loan conditions, moves out of the house for 12 consecutive months (for example, to go into an assisted living home or due to physical or mental illness the borrower is not able to live in the property on which the loan has been taken).
At that point, the Georgia reverse mortgage can be paid off with the proceeds of the sale of the house, or if the borrower has died, the property can be refinanced by the heirs of the homeowner's estate with a regular mortgage.
If the proceeds exceed the loan amount including compounded interest and fees, the owner of the house receives the difference. If the owner has died, the heirs receive the difference.
For cases where the proceeds are not sufficient to pay off the loan, then the bank (or Mortgage Insurance which the bank has on the loan) absorbs the difference.
The technical term for this cap on debt is "non-recourse limit." It means that the lender does not have legal recourse to anything other than the value of the home when the loan is to be paid off.
In most cases when the borrower moves out of the property or dies, as long as the borrower (or his estate) provides proof to the lender that he/she is attempting to sell the home or obtain financing to pay off the outstanding debt, the investor will allow him up to one year to do so.
After the one year extension period is up, the lender cannot provide any further extension of time to the borrower (or estate).
More Georgia Reverse Mortgage Loan Information:
Georgia Reverse Mortgage Requirements | Georgia Reverse Mortgage Costs and Interest Rates | When the Georgia Reverse Mortgage Loan Ends | Georgia Reverse Mortgage Proceeds